Steel market may stand still in Jun

The retail of construction steel in the market now fluctuates around 20 million dong per ton, while the steel price sold at the factories (VAT exclusive) ranges between 16 and 17 million dong per ton depending on each type, according to Vietnam Steel Association (VSA).

Pham Chi Cuong, the association chairman said that the steel sector is facing a surplus risk because the domestic demand is estimated at around six million tons a year while the country’s total construction steel capacity is 9 million tons. In addition, extra 5 high-capacity steel mills will be operational in the coming time with total capacity of 1.5 million tons a year.

Vietnam now has around 30 big-sized steel projects belonging to VSA. Also, there are hundreds of small sized ones in the country so the steel sector will see a fiercer competition.

Department of Price Management under Ministry of Finance predicted that the domestic steel price would be stable in last half of May. Steel billet in first 15 days of this month was offered at lower around $5 per ton than the same period of the previous month, particularly at $670-685 per ton in Asia.

Within May, the consumption of steel is estimated at 400,000 tons, down 40,000 tons against April. Steel in the domestic market is hard to go down in June because factories will extend production pace to release the stored volume instead of producing in mass. Furthermore, the world’s steel billet price will gradually be stable, so Vietnam’s steel industry will not have to suffer pressure of price reduction, Cuong remarked. – Vietbiz24

Posted by VBN on May 27 2011. Filed under Steel. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry